The Week Ahead
FOMC MEETING Wednesday, Nov. 12 -- The Federal Reserve Board's Federal Open Market Committee will meet to set monetary policy for the next five weeks. All 23 economists surveyed by MMS International, a unit of The McGraw-Hill Companies, expect that the policymakers will hold the bank's target for the federal funds rate steady at 5.5%. Moreover, almost all of the forecasters believe that the tame inflation outlook and rocky financial markets will probably keep policy unchanged for the rest of the year. That scenario is especially likely since the problems in Asia suggest that low U.S. prices of imported goods will continue to offset any domestic price pressures. The Fed last hiked rates on Mar. 25, when it lifted the federal funds rate by a quarter-point. PRODUCTIVITY AND COSTS Thursday, Nov. 13, 10 a.m. EST -- The Labor Dept.'s preliminary reading on productivity will likely show that output per hour worked in the nonfarm sector grew at an annual rate of 2.8% in the third quarter. That's about the same gain as in the second. That means that almost all of the increase in economic output last quarter was accomplished through increased efficiency, not by expanding total hours worked. As a result, unit labor costs probably grew only slightly last quarter, after edging up 0.4% in the second quarter. RETAIL SALES Friday, Nov. 14, 8:30 a.m. EST -- The MMS survey expects that retail sales increased by 0.3% in October, the same modest gain posted in September. Excluding cars, retail buying likely also rose by 0.3%, on top of a 0.2% advance in September. PRODUCER PRICE INDEX Friday, Nov. 14, 8:30 a.m. EST -- Producer prices of finished goods probably increased just 0.1% in October. Excluding the volatile food and energy sectors, core producer prices were probably also up 0.1%. The September price indexes gave the financial markets a small scare. The total index rose 0.5%, while core prices were up 0.4%.
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